I was wondering if you were planning to release a plugin for
Photoshop for running AIF effects on Photoshop images.

There are obviously limits to what can be done from within
such a script (no means to access selections etc.) and it would
certainly require some work to get filters that are more than
simple point operations to work correctly with Photoshop's tiling
architecture, but it would open great possibilities for Photoshop
users. Please don't make us wait until CS4 :)

Has there been any consideration for supporting a
closed-source commercial business model for AIF effects? That is,
do you envision a marketplace for effects, and the effects would be
compiled rather than distributed as plain text?

Also, it would be nice if Photoshop filter developers could
use AIF within the current filter and file format APIs.

yes and yes. We have certainly considered that 3rd party
developers might want to sell Hydra filters. We haven't come to a
final plan on how to protect hydra for commercial developers yet.
We're open to your opinions here.

Again, I can't talk too much about Hydra and Photoshop. I
hope to be able to talk more about any plans we are considering
soon.